MANILA, Philippines—Big is not necessarily better. Even American car manufacturer Ford, known for its big, macho vehicles, agrees.
According to Ford Group Philippines president Randy Krieger, over the next five years, 65 percent of the company’s offerings worldwide will be small cars.
“We believe this is where the industry will be going in the next five, ten years. Our market will also be changing from being North America and Europe-centric to focusing more on Asia-Pacific and Africa. In these markets, we sell more smaller cars,” he related.
In the next five years, he said around 40 percent of Ford’s global sales would come from the Asia-Pacific region, with the remaining 60 percent to be split almost evenly between North America and Europe.
The sales mix would also shift from being predominantly large vehicles to mostly smaller cars, he said.
Here in the Philippines, he related that motorists were also more inclined to buy smaller vehicles.
As if to prove this point, as of the end of the first quarter, the Fiesta sub-compact sedan was FGP’s best-selling nameplate, with sales reaching 799 units, outpacing the Everest’s 719 units.
In both February and March, sales of the Fiesta topped all of FGP’s models in the country at 268 and 308 units, respectively.
Ford Philippines closed the first quarter with sales of 2,387 units, representing a 74-percent increase over the first quarter in 2010. It is also the strongest quarter Ford has ever had on record.
“The Fiesta will continue to be the bestseller for us this year. It’s not only boosting our sales, but bringing more attention to the Ford brand in the country. It has helped us gain momentum across all our products,” he said.
He related that rising oil prices contribute to the popularity of small cars now. With black gold becoming more and more scarce and prices continuing to be volatile, small cars would increasingly gain popularity in the future.
For Ford, he said this presented an opportunity to launch not only smaller vehicles, but more fuel-efficient big ones.
“We believe oil prices will continue to increase, so we have to be the class leader in fuel efficiency. The new Explorer, for example, will be more fuel-efficient, will have more efficient transmission,” he related.
The launch of more small, fuel-efficient cars, he said, was also part of the US carmaker’s One Ford strategy.
He explained that under the program, products that would be developed for the global market would be the same across the board and not tailored for specific markets.
For example, instead of developing one small car for the European market and another one for the Asia-Pacific market, only one small car would be rolled out in all Ford markets worldwide, he said.
This would allow the company to better take advantage of economies of scale, he related, as well as make the Ford brand stronger globally.
“Under the One Ford plan, we are focusing on the Ford brand. That’s why we sold off our luxury brands. We also want to develop single products for the world. Part of this is the strategy to offer more small cars because we believe this is where the industry is going,” he said.
Meanwhile, at the Manila International Auto Show on Thursday, Ford Group Philippines will occupy the biggest display in local history at any public motor show with 1,000 square meters showcasing 15 fuel-efficient cars, high-quality cars, SUVs and trucks.